Multiscale decision-making: Bridging organizational scales in systems with distributed decision-makers

Christian Wernz and Abhijit Deshmukh

European Journal of Operational Research, 2010, vol. 202, issue 3, 828-840

Abstract: Decision-making in organizations is complex due to interdependencies among decision-makers (agents) within and across organizational hierarchies. We propose a multiscale decision-making model that captures and analyzes multiscale agent interactions in large, distributed decision-making systems. In general, multiscale systems exhibit phenomena that are coupled through various temporal, spatial and organizational scales. Our model focuses on the organizational scale and provides analytic, closed-form solutions which enable agents across all organizational scales to select a best course of action. By setting an optimal intensity level for agent interactions, an organizational designer can align the choices of self-interested agents with the overall goals of the organization. Moreover, our results demonstrate when local and aggregate information exchange is sufficient for system-wide optimal decision-making. We motivate the model and illustrate its capabilities using a manufacturing enterprise example.

Keywords: Decision; analysis; Distributed; decision-making; Game; theory; Hierarchical; production; planning; Multiscale; systems (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ejores:v:202:y:2010:i:3:p:828-840

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